2 years ago
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The Cyprus Securities and Exchange Commission said before that some of these illegal brokers were just spinoffs of previously shuttered companies while others misleadingly claim affiliation with other brokers that are already regulated in Cyprus and hold its CIF License. The watchdog has blacklisted the following domains:
cryptobanxatrade.com fxwet.com skyecryptofx.com capitalbasefx.comOne of the blacklisted brokers, CryptoBanxaTrade, claims to be based in New York and licensed in the UK for offering binary options, Forex and spreads. The shady website also falsely claims to be properly regulated by the US CFTC and the IFSC of Belize, as well as CySEC, which the Cypriot watchdog has just denied.
Meanwhile, Skyecryptofx touts itself as one of the largest stock exchange-listed FX & CFD brokers in the world. It further claims that it has offices in more than 10 countries including Belize, UK, Poland, Germany, Spain and France.
CySEC stresses that these firms are not licensed to operate a brokerage business in Cyprus, nor are they affiliated with a regulated entity. Additionally, it warns that if consumers lost their money on platforms that are not licensed, they are not protected under the Investor Compensation Fund (ICF). This serves to protect the claims of covered clients and provide them with compensation in case a member was unable to meet its financial obligations.
While many providers claim to be Cyprus-based, CySEC said, previously it believed such companies were based overseas and providing false addresses, adding that it would look into taking further action if companies were actually based within the country. It further explains that it is sometimes hard to find the names of the platforms’ operators on their websites, and that the addresses given as the company headquarters are often offshore letterbox addresses.
Under current laws, CySEC has no powers to force internet companies to refuse financial advertisements or block access to their domains. It can only ask them to take down fraudulent promotions once they have been spotted. As a result, fraudsters and promoters of high-risk schemes have been able to place advertisements claiming to be based or licensed in Cyprus.
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